A year ago tomorrow we reported: the kinetic energy from Bernanke’s bazooka lifted most sectors yesterday. Referring to the announcement of QE3, it was the first line we wrote here at ETFGsm Daily Perspectives. Over the following days we watched the China funds, GXC and FXI emerge into the top ranks with a handful of European funds and the gold miners in GDX which actually performed well back then. It took some time to find our voice but each day in the year since we have brought you the message of our world class quantitative models that until now were the exclusive province of billion dollar hedge funds.
Those mentioned funds rallied strongly last fall as the US market faltered under the weight of fiscal cliff fears. On November 14th we wrote: Quant has a clear message today, avoid the USA. That happened to be a bottom for the S&P 500 but Quant’s favored funds continued to handsomely outperform. Who else was recommending the iShares MSCI Turkey Investable Market Index Fund (TUR) around Thanksgiving time? We had fun with the pun on November 12th when we said the little plastic thing was popping up, it rallied over 20% to a peak on January 23rd while the S&P gained about 8%; but Quant had called another shift by then. On the day after Thanksgiving, we reported that Santa looked especially jolly closing out the Macy’s Parade and Quant had 3 US broad market Russell funds in the top 10. By that time other sites were on the emerging markets bandwagon but Quant was positioning you for a good old Santa Claus rally. On December 31st we declared our November 14th call reversed as 8 of the top 10 were US funds and 2 of those were S&P 500 funds.
The three funds tracking that index were top rankers throughout 2013's first half which made it difficult for us to beat the benchmark but we were happy to keep you on the US island in the world storm as we characterized it on April 8th when we highlighted a handful of Russell funds. The granddaddy of all ETFs, the SPDR S&P 500 Fund (SPY) was a top 10 fund for all but 2 days from February 5th through May 7th, and top 3 for all but 12. Anyone who owned it then was happy. Quant’s latest call was the move back to China and emerging markets after the June swoon, providing us positive separation from the benchmark yet again. 1st place GXC is also today’s 10 Green Diamond fund.
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